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DSW Inc. stock is falling on the company’s first-quarter earnings announcement.

The discount shoe retailer reported that net income for the quarter ending April 30 was $30 million, or 36 cents a diluted share, down from $47 million, or 53 cents, a year ago. Adjusted net income was $32.8 million for earnings per share of 40 cents, missing the FactSet estimate for 45 cents in earnings per share. The adjustments are related to the purchase of Ebuys. The company’s stock is declining by 8 percent in early trading to $19.86.

Sales for the three months increased 3.9 percent to $681 million from $655 million a year earlier. This was still short of the FactSet estimate for sales of $700 million. Of the sales total, $15.1 million came from the newly acquired Ebuys. Comparable-store sales decreased by 1.6 percent versus last year’s increase of 5.1 percent.

Investors decided to sell the stock after the company slashed its forward guidance. The full-year earnings guidance is now for a range of $1.32 to $1.42. The prior guidance had been in the range of $1.54 to $1.64. Capital IQ had an estimate of $1.58. The revenues estimate was lowered to an increase of 6 percent to 7 percent from an increase of 8 percent to 10 percent. Comps are expected to drop between 1 percent and 2 percent.

“We have reduced our sales and earnings guidance to reflect the current trend of our business in a challenging retail environment,” said chief executive officer Roger Rawlins. “This is the prudent action to take so that inventory, expenses and capital investments are aligned to maximize profitability and positioned to expand earnings as our trend improves.”

Gross profits decreased 250 basis points due to higher markdowns and the addition of Ebuys. Operating profits declined by 340 basis points due to the costs associated with the fulfillment of Ebuys orders.

The company saw traffic drop in March, with the cold weather states performing better than the warm weather ones. Women’s fashion and athletic did better than men’s. DSW said that solid results in the women’s fashion category indicated the customer’s readiness to embrace new trends.

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